The volumes on the Indian rupee options soared after India's strikes in Pakistan, suggesting that the currency may go through a volatile patch on the back of the heightened tensions between the two nuclear-armed neighbours.

“If Pakistan does follows through and hits India, the rupee will come under renewed pressure,” he said. Foreign investors were net buyers of Indian equities on Wednesday, per preliminary data, signalling that they do not foresee a significant flare-up in the India-Pakistan standoff.

The rupee weakened by 31 paise to reach 84.66 against the US dollar in early trading on Wednesday, following India’s missile strikes on terrorist camps in Pakistan and Pakistan-Occupied Kashmir, which heightened cross-border tensions.